TaxTMI 
TaxTMI 
2026 (7) TMI 647
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....anning authority fund as declared service under section 66E(e) of Chapter V the Finance Act, 1994 or not. 2. The appellant is a public sector undertaking and engaged in manufacture of supply of steel for the purpose of manufacturing steel, the appellant was granted mining lease for extraction or iron ore from Rowghat mines in Chhattisgarh by the State Government. Since certain deposits were located in the Matla Reserve Forest Area in Kanker and Baster district of Chhattisgarh, the appellant obtained environmental clearance for diversion of forest land for non-forest purposes from the Ministry of Environment, Forest and Climate Change subject to compliance with the specific conditions, including payment into the Compensatory Afforestation....
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....le 48 of the Constitution of India. We also observe that the charges are collected in pursuance of the decision of the Hon'ble Supreme Court. From the impugned order, we observe the adjudicating authority has considered the payment of NPV as a consideration for the 'Declared Service' as defined under Section 66E(e) of the Finance Act, 1944. The observation that the Government is 'tolerating the act' of the appellant against a 'consideration' is legally not sustainable inasmuch as one cannot envisage the situation as apprehended by the Department that by collecting NPV, the Government is tolerating the act of the appellant. 8.1. We also observe that the issue regarding taxability of the payment of NPV in the CAMPA Fund stand....
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....t the payment made to CAMPA Fund is for the purpose of toleration of an act or a situation. In the present case the act of the Appellant tolerated by the Government is the act of conversion/diversion of forest land and use of the same for non-forestry purposes and consideration has been paid for the purpose of tolerating the mining activity by the Government. And for such act of toleration by the Govt., the appellant have paid compensatory levies/charges to CAMPA Fund which is being administered under the aegis of Central Government. Accordingly, the impugned order justified the demand and confirmed the same. 8. We observe that the payment of NPV to the CAMPA Fund has been made by operation of law and the Appellant has no choice wh....
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....of the concerned State Government. 8.2. We find that Tribunal Kolkata has decided a similar issue in the case of MNH Shakti Ltd Vs Commissioner of Central Excise and Service tax, Rourkela, wherein it has been held as under: "6. The question of tolerating something and receiving a compensation for such tolerance pre-supposes that:- (a) The person had a choice to tolerate or not; (b) The person had a choice to tolerate or not; (c) Such tolerance was for a consideration as per an agreement (written or otherwise) to tolerate; d) The tolerance was a taxable service. None of the above elements are present in the present case. The appellant had no choice of tolerating cancellation or n....